Save More Money on Family Car Costs

A car is typically a family’s second biggest investment, after mortgage or rent. And if you’re a two-vehicle household, the outlay is twice as substantial. Here’s some expert advice to help you get the most for your money.

Tighten Your Gas Cap

Each year in the United States, 147 million gallons of gas evaporate due to loose caps. Don’t let any of it be yours. “Twist your cap until you hear three or four clicks,” advises Lauren Fix, spokesperson for the Car Care Council, a consumer education organization.

Fill Your Tires Frequently

Driving on poorly inflated tires can waste two or three miles per gallon because it takes more energy for the tires to rotate. On the other hand, driving on overinflated tires is dangerous because it reduces traction. Buy a digital tire gauge ($13 to $30 at Amazon.com), and check your pressure every couple of weeks (digital gauges are accurate and easy to read). “While you’re waiting for the tank to fill, check each tire to make sure it’s properly inflated,” Fix says. The proper pressure is listed on a sticker on the inside of the driver’s door.

Change Your Air Filter Every Six Months

“A dirty filter makes the engine work harder, which wastes gas,” Fix says. If you don’t feel comfortable changing the filter yourself, head to an auto specialty store like Pep Boys. Buy a filter, and a technician will install it for free. “This typically costs less than having a new one installed at the dealer or the place where you have your oil changed.”

Log On for Lower Gas Prices

The price of gas can vary by as much as 50 cents a gallon from one filling station to the next, even within the same zip code. Visit GasBuddy.com or GasPriceWatch.com, and punch in your address to find the lowest prices at stations near you. Using certain credit cards can also help soften the blow: Discover offers 5% cash back on gas and auto maintenance purchases; some gas companies, including Shell, Exxon and BP, also offer discounts at the pump or rebates ranging from 3-10% to customers who use their cards. Just be sure to read the fine print. With some of these cards, the rebates and discounts diminish after six months or so.

Find a Trustworthy Mechanic

If your car is leased or under warranty, the cost of repairs might not be something you worry about. But if you drive a used car and want to keep it in tip-top shape, you’ll want to find an affordable, reliable mechanic. Find technicians certified by the National Institute for Automotive Service Excellence at asecert.org or 1-888-ASE-TEST. A “master technician” is certified to work on every part of a car, not only the brakes, for instance, or the steering.

Before you agree to any repairs, be sure to get an estimate. It should be free unless you’re having a used car inspected before you buy it. Tell the mechanic that you’ll pay for the repairs on the estimate, but ask him to call you first with a firm price for any additional fixes he wants to do. It’s also a good idea to check in with the local dealer, even if you didn’t buy your car there, every six months to a year to make sure there hasn’t been a recall on your vehicle. “Call the service department, and ask if there has been a ‘Technical Service Bulletin’ within the last few months,” Fix says. Sometimes independent mechanics don’t know the problems of a certain model, but a dealer will fix them for free.

Hybrid Cars: Are They Worth It?

These are hot-ticket items—in some markets there are months-long waiting lists for models like the Toyota Prius. Hybrid engines run on a combo of fuel and an alternative energy source (such as a rechargeable battery), which means they get significantly better mileage than cars running on gas alone. And they use less gas, so they’re a greener and cheaper way to travel. Still, the price includes a premium, adding as much as $5,000 to the cost of the comparable nonhybrid version. For example, a regular Honda Civic starts at around $15,000, but the hybrid version starts at $22,000. You’d have to keep the hybrid for at least four years to pay for the savings in fuel costs.

Should You Lease or Buy?

“There’s no one right answer for every family,” says Chris Jacobs, spokesperson for eBay Motors. “The best option for you depends on your personal financial history and how long you tend to keep your cars.” Buying and leasing are different ways of financing a car, so you have to decide which is more important: having new wheels every two or three years with relatively low monthly payments (leasing) or having higher monthly payments at first but owning the car debt free after several years (buying). Here, the rundown for each option:

Leasing: If you want a new car and low monthly payments, this might suit your budget. It’s also a good option if you want to map out your exact car costs, since repair costs are typically built into your fee. Another big advantage: There’s no huge down payment.

Buying: “If you keep your cars for more than three years, you’re better off buying,” Jacobs says. At that point, you’ve likely already paid off much of your car loan. Another important consideration: annual mileage. If you drive more than about 12,000 miles a year, leasing probably isn’t a good option, as leased cars typically have low mileage allowances (driving extra miles can cost you 20 cents per mile). Then again, everything’s negotiable.

Are You Buying Too Much Insurance?

“Consult with your insurance agent every year or so to make sure you have enough insurance but aren’t paying for coverage you don’t need,” says Nancy Cain, spokesperson for the American Automobile Association. After all, required minimum amounts vary from state to state. And shop around. Insurance experts say that consumers stick with a company for years simply because they don’t take the time to compare what other companies offer. Some things to consider:

If you want to lower your monthly payments, increase your deductible. This is the amount you’re liable for if you’re in an accident—and the higher the amount, the less you pay each month.

Some companies offer discounts for people in “low risk” jobs, such as teaching or engineering. Others offer decreased rates if you combine your homeowner’s (or renter’s) insurance with the policy for your car.

Should You Buy a Built-in GPS?

Wait a sec before you buy built-in GPS devices or entertainment systems—they end up costing a lot more when purchased from a dealer. Instead, buy them from a retailer like Best Buy, and have them installed on site. You’re more likely to get an interest-free loan here than at a car dealership.

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LearnVest Planning Services is a registered investment adviser and subsidiary of LearnVest, Inc. that provides financial plans for its clients. Information shown is for illustrative purposes only and is not intended as investment advice. Please consult a financial adviser for advice specific to your financial situation. LearnVest Planning Services and any third-parties listed, discussed, identified or otherwise appearing herein are separate and unaffiliated and are not responsible for each other’s products, services or policies.